Value chain analysis of Kenyan tea
Unilever is a British-Dutch transnational company founded in 1930, operating in 121 countries, sourcing raw material from 91 countries, and works with 3rd party manufacturers in 80 countries. They are a publicly traded company and have annual net profit close to £8 billion making them one of the leading companies in the world.
After the food crash of 2007-8, Unilever underwent massive changes, restructuring and consolidating their businesses, and committing to the integration of sustainability into their supply chain. Ideally, CSR is the 'social contract' that exists between a society and a business meant to inform and frame business's obligations to the society of which is a part. To better understand this relationship is through Alice Caroll's CSR pyramid, a two-dimensional framework for understanding three-dimensional issues. Alternative nomenclature for modern CSR approaches may be "corporate citizenship, sustainability, stakeholder management, business ethics, creating shared value, and conscious capitalism" (Carroll, 2016), each of which are imbued with the agenda of the business.
In 2007, they teamed up with the Rainforest Alliance and began using their certification schemes to help ensure that the primary producers they source from are sustainable. Although the Rainforest Alliance is the largest third party actor that Unilever uses, they also use alternative third party certification (TPC) schemes such as the Ethical Tea Partnership.
In 2019, pushing forward with their sustainability agenda, Unilever published its tea supply chain, stating that 100% of their raw materials would be sustainably sourced by 2020 (Unilever, 2019). Combing through their tea suppliers, they rely on large management companies to facilitate their tea needs. Unilever Tea Kenya Ltd (UTK) is a subsidiary of Unilever and is the single largest private sector employer in Kenya with approximately 16,000 permanent employees and 4,000 seasonal labourers (Wal, 2011).
Additional management companies such as the KTDA oversee several smallholder farms and manage certification, education, and standardization of manufacture. Other companies such as Eastern Produce, James Finlay Ltd, Iyayo Tea Zones, and Williamson Tea Kenya Ltd have their own plantations and factories and help manage smallholder farms, but they do not manage the plantation workers or the day labourers employed by the farms.
The export of Kenyan tea is managed by the East African Tea Trade Association. They oversee tea auctions at the Mombasa Tea Auction, they work with the agriculture union (KPAWU) and the Kenyan government ensuring that the tea market in Kenya thrives. Much of the tea purchased at the Mombasa Tea Auction (the second largest tea auction in the world) is shipped to the Lipton Jebel Ali Factory in Dubai (Hilton, 2015). Here the tea is blended and packaged for shipment. With Dubai's flexible trading policies and cheap labour, Unilever made the decision to finish their tea at their Lipton factory. Unilever has over 300 factories and warehouses world-wide and they are working with two companies that oversee operations, transportation, and logistics: LeanLogistics, an AI firm specializing in SAP HANA and Microsoft to simplify their manufacturing and supplier interactions. It is assumed that streamlining will help increase Unilever's direct-to-consumer (DTC) and hypermarket strategies as well as reducing inefficiencies in transit to the more traditional retailers such as grocery corporations and small scale retailers.
The tea supply chain of Kenya is difficult to follow, has many moving parts, and numerous actors, each of which has their own standards and methods, when coupled with a transnational multibillion-dollar corporation the net becomes a chain. Sustainability, by and large, is difficult to measure and when using TPCs it can become convoluted. When you consider different definitions, alternative measurement metrics, and lack of accountability, it becomes exponentially difficult. Unilever's commitment to have a 100% sustainably sourced tea chain is admirable and fulfills their CSR pledge to their customers, but as this essay showed, they will need much more transparency and accountability to have a truly sustainable [tea] supply chain.
To learn more about this issue, I recommend the new documentary Kikuyu Land (2026).